Transcorp Hotels Plc recently released its results for the Q3 2022 recorded double-digit revenue growth of 55 per cent, to close Q3 at N22.7 billion and grew Profit after Tax by 206 per cent over the previous year, closing Q3 2022 at N2.3 billion. No doubt, the Company continues to set the standard in the hospitality industry with innovative ideas, focusing on excellence, execution, and enterprise as its core values that help to sustain its exceptional performance, as demands continue to rise. In this Interview with Idris Bakare, the Managing Director, Transcorp Hotel, Mrs Dupe Olusola speaks on the company activities.
How has it been so far since you took over as Managing Director of Transcorp Hotel?
I became Chief Executive/MD at a very interesting time — at the onset of the COVID pandemic — an unprecedented experience that caused so much global disruption and mostly to the travel and hospitality sectors. The hospitality industry was particularly affected by the ensuing restriction on local and international travel, and limitations on social interaction — indeed trying times for all. Despite the unprecedented twist that surfaced in 2020, we continued to implement our innovative strategies as well as novel initiatives aimed at curtailing our imminent loss position.
I led our outstanding team at Transcorp Hotels Plc to deliver above expectations in 2020, building momentum into 2021 where we recorded a remarkable recovery. We created and developed a domestic leisure market providing products for this market and successfully diversifying our target market. We haven’t stopped building on this, and this year to date, we have broken performance records. All this was through the effort of my amazing team. Their passion and resilience is second to none.
Despite the economic downturn that impacted negatively on many businesses, Transcorp showed resilience with an impressive financial result. How were you able to achieve that?
It is our mantra to continually think outside the box. The pandemic taught us that lesson as we had to innovatively create activities to bring back guests to the hotel, assure them of their safety through the Hilton Clean Stay program, and improve our overall service delivery. We did not rest on our laurels in 2020, we were aggressive in driving business and, very importantly, leisure activities to the hotel, by curating experiences for guests to enjoy, at bundled rates. While driving our leisure business to make up for the dwindling performance of the international business travelers segment due to the travel restrictions. We continued to use targeted marketing to maintain top-of-mind awareness. Hence, when normalcy gradually returned, we were the top choice & prime location for locals and international travelers.
Our 2021 numbers are a testament to the strategies we implemented during the recovery year as we achieved over a 100 per cent of our top-line figure and overturned the N8bn loss to a N1bn profit. Similarly, 2022 has been remarkable as well. Our 9-month revenue already exceeds our FY 2021 revenue by about N1bn.
We continue to reinforce our position as the all-round industry leader with an increased and continued focus on delivering excellent service quality, customer satisfaction, and security of our guests.
Foreign exchange volatility has been a major issue for businesses in Nigeria. To what extent has this affected your operations?
Foreign exchange volatility has indeed impacted our business and has significantly increased the cost of operations. The forex volatility coupled with inflation have escalated the costs of goods and services.
However, our primary strategy is to grow our revenue at a faster pace than the costs are growing. We closely monitor and implement innovative measures to ensure continuous cost optimisation. We reduce our forex needs in the procurement of consumables by sourcing and helping to develop SMEs to access local alternatives that meet our required standards.
Apart from forex, what other challenges can you say are affecting your operations and how have you been able to surmount them?
We are very big on service delivery. Hence, we are constantly doing our best to deliver excellent services to our guests always. However, there is a lot of investment that go into having adequate staffing and training to keep improving our staff and equipping them to maintain the level of excellence our guests have become accustomed to. This is sometimes very challenging, and it is not just about cost; sometimes, it is even getting the right people. We are, however, resolute about the quality of service we deliver to our guests, so we always find a way.
Various challenges arise at different times for all businesses. What differentiates the best-performing businesses from others is their ability to deal with challenges head-on and being able to adapt while staying true to their core values.
What competitive advantage do you have over other five-star hotels in Nigeria?
First of all, we have the strong Transcorp brand name that has been built and sustained over the years, known for excellence and impacting the country positively. We have been able to consistently deliver excellent guest experiences and maintained an unrivalled record of excellence in the hospitality industry. We also have a rich history; our property, built in 1987, has hosted world leaders and has continued to evolve to maintain the quality we are known for, with great facilities that we have continued to improve to remain competitive in our fast-growing industry. In 2015, we spent over $100 million to upgrade our property in Abuja. We are constantly improving our overall facilities — rooms, restaurants and open areas, to ensure we are able to maintain the high standards we are known for.
Just like I mentioned earlier, we are known for service excellence. We go above and beyond to meet and even exceed our customers’ expectations. Independent review from our customers shows how well we are doing in satisfying them. This year, we have won the Trip Advisor’s Traveller’s Choice Award as well as the Booking.com Traveller Review Award. So, service excellence is an important attribute that separates us from our competitors.
We are also lucky to have passionate and committed staff, who have a mindset of execution and have continued to help deliver on our customer promise and doing their best to even get better.
In what ways do the hotels positively affect their immediate communities as part of their Corporate Social Responsibilities?
We are highly committed to giving back to the communities where we operate. We make periodic donations to hospitals, orphanages, and old people’s homes through our properties in Abuja and Calabar (Transcorp Hotels Calabar).
Every year, we empower women to learn new skills, including business and entrepreneurship skills to help them build their businesses. The Business Empowerment Programme for Women is an annual program that has helped a lot of women.
We also have the Soap for Hope Project, where we make soaps through recycling and distribute to nearby communities. This is in addition to the material and financial donations we make to different bodies.
We are also a significant contributor to the Tony Elumelu Foundation, a philanthropy that supports thousands of entrepreneurs across Africa every year with a seed investment of $5,000 each.
We are continuously looking for ways to give back to our communities in line with our ESG commitment of doing good, even as we do well.
Why the choice of a Transcorp Hotel in Lagos?
Business expansion is key to growth & prominence. Lagos is the largest city in West Africa and a key commercial nerve centre in Africa. It is imperative as part of our strategy to be Africa’s leading hospitality brand, that we expand our business into the city of Lagos. It is also important to reiterate that our Lagos development is not a new idea, it has always been a part of our strategy. In addition, we have plans beyond Lagos to build in Port Harcourt and expand beyond Nigeria to Africa
Now the major challenge Nigerian hotels have is power. That is why the prices are very high. So how are you managing that?
We are the only hotel in Nigeria that provides uninterrupted power on our facilities, and we continue invest to ensure we deliver world class standards for all our guests at all times despite the increasing energy costs and unreliable power. We continue to proactively invest in projects that can better help us achieve power efficiency to save on costs.
What is Transcorp’s overarching strategy for identifying and developing future leaders and how has it strengthened the organisation?
We have a robust human capital strategy that is built upon our aim to attract, train, motivate and retain the best talents. Our recruitment and succession planning processes are governed by these ideals as well. Most importantly, our visibility in the economy through our strong performance, our brand image portrayed on our platforms, help us to attract quality talent who are aligned with our purpose of transforming Africa.
What is the secret to your success? How have you been able to effectively manage the best hotel in Nigeria?
The secret lies in the strength of our people. We have a multi-dynamic & diverse team and a great work environment where we promote innovation across the entire company. As they say, “culture eats strategy for breakfast.” Our culture & core values of Excellence, Execution, and Enterprise is lived out in our everyday lives as well as in our strategic decision-making.